I just read this interesting article about a chemist in Boston who is working on harvesting hydrogen and oxygen from water as a clean energy-generation source. Lots of dire predictions about the energy needs and production capabilities over the next few decades.
A few years back, I spent some time looking into the energy (and especially electricity) industry -- based simply upon some back of the envelope calculations on the amount of electricity that would be required just to power all of our PC's and servers by the end of this decade, and realizing that there might be a serious shortfall. I came away pretty discouraged. There are three Grand Challenges in the electricity industry:
1. Clean production -- meaning no carbon dioxide exhaust, and no hazardous waste. Solar and wind are getting more efficient every year, but they still have a very long way to go before they will be economical -- if for no other reason than the amount of real estate they take up per KwH generated given existing efficiency, let alone manufacturing and maintenance costs. Hydro is a little more efficient, but has environmental issues. That is nominally the topic of the article I linked to above -- clean generation.
2. Storage. We have no efficient, economical way of storing large amounts of electricity. Today, our battery technology uses really nasty chemicals which are expensive and dangerous. In practice, there are no large electricity storage "tanks" in use anywhere. This seems like an easy thing to dismiss, but understand that electricity usage fluctuates wildly over days, weeks and months based upon day vs. night, and seasonal temperature. During the day, our power plants are running to capactity for much of the year; at night (particularly in the summer), they are far under-utilized. If we could simply store electricity, we could dramatically increase our total power generation. As it is, hydro plants use their excess production to pump water back up to the top of the dam. (for environmental reasons, they need to keep the water running all the time). Remember "potential energy" from high school physics? This is it in practice.
3. Transmission. Current power transmission is incredibly lossy. I've seen estimates that simpy moving power from the hydro plants in eastern Washington State over to Seattle they lose about 20% of the power in transmission. Why? Resistance in the wires. If someone invented a room-temperature superconductor, we'd be in business. As it is, in the winter California send power up to Washington, and in the summer Washington sends it down to California, but wow is that inefficient.
So there you have it. We can't generate it efficiently and cleanly, we can't store it, and we can't transmit it efficiently. Solving any one of these would dramtically increase our available power and get the inventor a Nobel prize in physics or chemistry. Solving all three would be worth a Nobel peace prize, as it is probbaly the only thing that would bring peace to the planet.
8:49:33 AM 
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